L&T has terminated its Bengaluru Suburban Rail Project contracts, accusing K-RIDE of land handover delays. K-RIDE alleges illegal withdrawal and poor performance. L&T has moved court seeking ₹505 crore in damages over the dispute.
Bengaluru: L&T has terminated its contract for the Bengaluru Suburban Rail Project (BSRP), accusing the Karnataka Rail Infrastructure Development Company (K-RIDE) of negligence in handing over the required land. K-RIDE, however, alleges that L&T illegally withdrew from the agreement without meeting performance expectations.
The project has already been hampered by the absence of a permanent managing director at K-RIDE, lack of coordination with South Western Railway, and delays in land acquisition. The termination has now escalated into a war of words between the two parties.
Scope of the Cancelled Contracts
L&T was awarded the contracts for constructing the 25.01 km Sampige corridor (Chikkabanavara – Baiyappanahalli) and the 46.24 km Mallige corridor (Heelalige – Rajanukunte) under the BSRP. According to K-RIDE, L&T officially cancelled both contracts on July 31.
The completion deadline for the Sampige corridor had been extended to September 30, 2026, with options for further extensions. K-RIDE says it had accepted all of L&T’s requests, including mechanisms for time extensions and dispute resolution in cases of delayed land handover.
K-RIDE’s Allegations Against L&T
K-RIDE accuses L&T of making unreasonable demands, such as revising contract costs within the contract period and converting the Engineering, Procurement, and Construction (EPC) contract into a Bill of Quantities (BOQ) contract, terms not allowed under the agreement.
They further allege that despite sufficient manpower, L&T failed to achieve expected progress, frequently changed project managers for corridors 2 and 4, and ignored repeated warnings about poor performance.
K-RIDE notes that discussions were ongoing with a ‘Conciliation Committee’ as outlined in the contract, yet L&T proceeded with what they term an “illegal” termination.
L&T’s ₹505 Crore Damages Claim
L&T has taken the dispute to the city’s commercial court, seeking approximately ₹505 crore in damages for the Mallige corridor contract. The company claims K-RIDE has given false assurances since 2022, failed to hand over required land, and still owes them bank guarantees, mobilisation guarantees, security guarantees, and compensation for losses.